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delong.typepad.com - 6/12/2009
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The End of the Panic of 2008
Matthew Yglesias —
Brad DeLong notes that the TED spread, a key indicator of banking system confidence, has returned to normal:
Unfortunately, while there was a long time when we were experiencing a financial panic combined with a fairly mild recession, for the past six months or so we’ve been in a severe contraction in the “real” economy. The financial system getting back to something approach normal is definitely a good thing, but it’s no longer clear that an end to the banking panic will lead to recovery. On the contrary, we’re to some extent now at a point where “real” problems are causing financial ones. After all, even a ...
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